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Construction industry in crisis: threatened wave of bankruptcies threatens skilled workers
Construction crisis in Germany: Experts warn of a wave of bankruptcies and a loss of skilled workers. Bankruptcies are increasing in the construction industry. Concerns in Berlin are ignored. #Construction industry #Housing #Insolvencies
Construction industry in crisis: threatened wave of bankruptcies threatens skilled workers
The construction crisis in Germany still shows no signs of easing. The negative trend in building permits continued in February, with the number falling by 18.3 percent compared to the same month last year to 18,200. Expensive materials and increased financing costs are particularly noticeable in residential construction, which deters potential builders and investors. The decline in building permits for single-family homes was particularly sharp, with a decline of 35.1 percent, followed by two-family homes with a decline of 15.4 percent and multi-family homes with a drop of 21.5 percent.
The ongoing crisis in housing construction is leading to a high percentage of canceled orders, which is further exacerbating the situation in the construction industry. According to a company survey by the Munich Ifo Institute, almost every fifth company in German housing construction is affected by canceled orders. In addition to the cancellations, there is a lack of new orders, which means that 56.2 percent of companies complain about a lack of orders. Thomas Reimann, President of the Hessian and Thuringian construction industry, is concerned about the lack of reliability of political decision-makers in Berlin, which is affecting entrepreneurial commitment in the industry.
Bankruptcies in the construction industry are also increasing, with the wave of bankruptcies predicted to become evident this year. The credit insurer Atradius expects an increase in insolvencies of between 10 and 15 percent compared to the previous year. Experts warn that the loss of businesses in the sector puts much-needed skilled workers at risk. The increased interest rates and construction costs have increased the slack in construction, as private individuals and investors find it difficult to afford to build real estate. There are calls for politicians to take measures to stimulate the construction industry and achieve the goal of 400,000 new apartments per year, which experts say will also be missed by 2024.